Hynix cuts capex, delays funds in China

South Korean memory maker Hynix plans to cut spending on a fab in South Korea and will delay a $260 million investment in its Chinese joint venture with Numonyx B.V., according to Reuters.

In total, Hynix has lowered its previously-announced 646 billion won ($491 million) in capital spending to upgrade its Korean fab to 491 billion won ($367.7 million), due to the memory downturn, according to the report.

''Hynix would also delay a planned $260 million investment in its Chinese plant, run jointly with Numonyx, to 2009 from 2008,'' according to the report.
Numonyx and Hynix are the partners in the Wuxi, China fab. The fab venture is majority owned by Hynix.

The move follows a series of problems at Hynix, which is suffering due to the memory downturn. Micron, Qimonda, Toshiba and even Samsung are also suffering.

But it's been a topsy-turvy time for Hynix. It is seeking to generate cash amid losses and the downturn.

Seeking to cut costs amid a deep memory downturn, Hynix in December said it would slash its workforce and trim executive salaries, according to reports. The company is also cutting its DRAM production by 20-30 percent. And it is selling the equipment from its shuttered fab in Oregon to rash cash.

To maintain its operations in the form of a rescue package, Hynix this week said it will obtain 800 billion won ($598 million) in bank loans from its shareholders.

Hynix is not the only company in trouble. Memory rival Micron Technology Inc. this week reported a net loss of $706 million, or 91 cents per share, on revenue of $1.4 billion for the first quarter of the company's fiscal 2009, which closed Dec. 4.

Results were down on a sequential and year-to-year basis. For the prior quarter, Micron posted a net loss of $344 million, or 45 cents per share, on sales of $1.45 billion. For the year-ago quarter, the company reported a net loss of $262 million, or 34 cents per share, on revenue of $1.5 billion.

Struggling memory maker Qimonda AG this week announced that is has arranged a 325 million euro (about $450 million) financing package. In return, Qimonda has promised to continue to develop its R&D and manufacturing sites in Porto, Portugal and Dresden, Germany.

Japanese DRAM house Elpida Memory Inc. is mulling over a plan to acquire Taiwan's Powerchip Semiconductor Corp. Both DRAM suppliers are losing money amid the memory downturn. Powerchip and Taiwan DRAM house ProMos Technology Corp. are seeking bailouts.

Even the mightly have fallen. Recently, Toshiba Corp. said it has decided to cut NAND production by up to 30 percent at four of its major facilities in Japan starting early in 2009 in response to sluggish demand and as a sharp cutback in sales led to a buildup in inventories worldwide.

Word on the street is that mighty Samsung Electronics could lose money in Q1 of 2009, according to The Korean Times.